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Berkshire Hathaway’s Holding Histories with Wells Fargo, Moody’s, and U.S. Bancorp; New Feature Announcement

May 27, 2010 | About:
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You may have noticed that GuruFocus has added a “History” button on Guru stock picks and portfolio holdings pages. By clicking on these buttons you will see the holding histories of the Gurus with this position over the past 5 years. This feature will help you to understand more about the confidence and valuations our Gurus have to this position. You can see this more clearly with Warren Buffett’s holding histories on Wells Fargo, Moody’s, and U.S. Bancorp.

Warren Buffett’s Holding History with Wells Fargo (WFC)



If you go to the portfolio holdings of Warren Buffett, click on the “Weighting”, Berkshire’s portfolio will be sorted in the order from the largest positions to the smallest. CocaCola (KO) is listed as the largest position, with 21.6% of weightings. Wells Fargo (WFC) is the second largest holding. Clicking on this row of data, an area appears underneath and the holding history of Warren Buffett with WFC is displayed. These are the highlight of the chart:

  1. The chart shows the holding history of up to 5 years.
  2. All the prices and shares data are split adjusted.
  3. On the chart, the green line is the quarterly average price of the stock,
  4. The yellow bars show the number of shares Buffett owns at different quarters.
  5. On the right side table, only the quarters that have share number changes are shown
  6. The buy/sell price are compared with the current price
  7. At the bottom, the average paid price for WFC is compared with the current price. We can see that Buffett is still losing money with WFC, by about 11%.
buffett_WFC.jpg

By looking at the history we can get a clear idea on how Warren Buffett likes WFC. He has been adding to WFC through the past 5 years, at the prices which are 10-20% higher than the current prices. Even as he needs cash for his BNI deals lately, he keeps his position with WFC firm, and adds to it whenever possible. The holding history clearly shows that WFC is his long term favorite and the trend now is to buy more WFC.

Warren Buffett’s Holding History with Moody’s (MCO)



This holding history of Warren Buffett with Moody’s shows a totally different picture. After receiving the Moody’s shares from the spin-off from Dun & Bradstreet Corp. (DNB), Warren Buffett kept his MCO position firm, and he did not sell a share even as the price was above $70. But he started to sell it in the third quarter of 2009, by now he has sold more than 17 million shares out of the 48 million he originally owned at the prices around $30 or lower. The current trend with MCO is clearly to sell.

buffett_MCO.jpg

Buffett has stated publicly about Moody’s recently. He even said that Moody’s will trade higher in the future in his latest shareholder letter, but he has been selling Moody’s at much lower prices that he could have sold at. Clearly he is losing confidence there. Today we published an article about David Einhorn, he has been shorting Moody’s.

Warren Buffett’s Holding History with U.S. Bancorp (USB)



Buffett’s holding history with USB shows that this is another favorite holding of his. Buffett started to in the first quarter of 2006 at prices that are 30% higher than its current price, and adding to the position from 2006 to 2008, then he keeps the position steady even as he has been trying to raise some cash and selling other positions. He added into USF at the bottom of the market in March 2009, and those trades have appreciated more than 55%. Overall, he is still losing about 25% with USB.

buffett_USB.jpg

U.S. Bancorp has a market cap of $45.25 billion; its shares were traded at around $23.63 with a P/E ratio of 22.4 and P/S ratio of 2.3. The dividend yield of U.s. Bancorp stocks is 0.8%. U.s. Bancorp had an annual average earning growth of 2.1% over the past 10 years.

Conclusions;



By examining the holding histories of Gurus with his positions we can get a better picture of the Guru’s long term sentiment with the stock. This is especially true for the Gurus who have low turnovers.

The holding history charts and tables show up to 5 years of data. All the prices and shares data are split adjusted. This feature is for GuruFocus Premium Members Only. If you are not a Premium Member, we invite you for a 7-day Free Trial by following this link: https://www.gurufocus.com/membership/upgrade.php


Rating: 2.4/5 (28 votes)

Comments

janbil1
Janbil1 premium member - 4 years ago
In addition to split adjusted, are the shares adjusted for dividends?
gurufocus
Gurufocus premium member - 4 years ago
No, share prices are not adjusted for dividends.
janbil1
Janbil1 premium member - 4 years ago
Over a five year period that would make a big difference in how your average buy price. Perhaps you should write that prices are not adjusted for dividends.

dardashti
Dardashti - 4 years ago
Very Interesting!

Presuming it's coming from 13-F, which could have impacts on:

(A) Overall AUM movements (rebalancing)

(B) Market level datapoints --- like, "upgrading" BRK into "a basket of net-nets"

(C) Tax loss selling stuff

(D) Nuances that can complicate a 13-F (i.e., selling the US listed shares

to buy a non-USA listed version of the equity --- or, maintaining the same

position size but in a different SEC registered account)

Also, if a company does a ton of buybacks (AZO, for example) -- the share price might be flat for 5 years, but -- the implied P/E, P/B, P/S is actually "cheaper" with time, since each share in 201X reflects a larger slice of the pie than was the case in 200X

---

What could be interesting is to report the data from 13-F (shares owned, market prices) and also the following:

(1) The total portfolio size, as reported by 13-F (perhaps, there was redemption selling, or inflow buying? Perhaps trimming a very large position? etc.)

(2) It's interesting to see additional buying -- both since the price declines, but also - if the company has a material improvement.

For example, interesting to explore the data in conjunction with a ValueLine Tear Sheet and/or a 10 Year Morningstar Review (for example: http://quicktake.morningstar.com/StockNet/Profitability10.aspx?symbol=AZO )

Wishing only the best,

Shai

dardashti
Dardashti - 4 years ago
re: dividends and buybacks:

(a) Perhaps, also include a table of shares outstanding (and a metric on % of total company level ownership) -- it's possible the shares owned never grow, since, was just building a position to a 5% or 10% company ownership level.

(b) Perhaps, if it's possible, look at the 10-K reported Statement of Cash Flow -- and explore if "Cash Flows, Financing" is unusually material - vs. "Cash Flows, Operating" or even simpler: vs. income statement revenue, or vs. balance sheet equity, etc.

Could be misleading to see a share price drop by 50%, and yet "the silence, of no additional buying" --- if, the 50% share drop was simply a one-time special cash dividend rather than a collapse in the equity.

This type of situation has happened with some Baupost investments in the past, and might continue to happen with more investors as there's increasing efforts towards "event driven" or "special situation" or "event driven" or "market insensitive" -- etc. -- approaches.

A dramatic illustration of the above is Footstar (FTAR)

Shai
dardashti
Dardashti - 4 years ago
With regards to (B) -- the potential that a position is being sold, and the proceeds being re-allocated into an "upgrade" opportunity...

Very interesting to see the holding size, and share price data,

- in the context of what's happening to the company's fundamentals itself (re: a Value Line or Morningstar type sheet), and

- in the context of what's happening to the company's valuation and the market valuation, which could be expressed as:

* company valuation: price/sales, price/book, price/NCAV, price/earning, EV/EBIT

* market valuation:

Bull-curve of the market, with datapoints of the above valuations (sales, book, NCAV, earnings, EV/EBIT) -- at each decile. In other words, what's the p/book of the "cheapest" 10% of the market? 20% of the market, 30% of the market, etc.

---

In other words, if "1-in-10" companies trade for less than GAAP book, "1-in-50" companies trade for less than liquidating value, and "1-in-100" trade for less than net working capital and are also cash flow positive --- in such a specific circumstance, if could make sense for a portfolio manager to sell some BRK and buy something else - in theory.

For argument's sake, the above could be especially true (and relevant) should BRK maintain a flat share price at the same time as there's a momentary pocket of cash flow positive net-nets...

Shai
gurufocus
Gurufocus premium member - 4 years ago
Thank you for the comments Shai! We will think along this line to see we can do something more interesting!

GuruFocus.

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